Automate Prepayments
in Xero
An Annual Insurance Invoice Arrives. Xero Posts It All To This Month. Spread Posts It Across Twelve
No Credit Card
Prepayments are supposed to be simple. Pay in advance, recognise the cost as you consume the service. In practice, they sit in a spreadsheet that someone updates manually every month-end, and only one person really understands it.
Spread reads every line description and invoice in Xero, detects the prepayment period, and allocates the correct monthly cost automatically.
Your prepayments balance is always right. Your P&L always reflects reality.
The Prepayment Problem in Xero
What's Happening Now
An annual software licence arrives in April.
Full cost hits April's P&L.
Someone manually calculates the monthly amount, posts a journal to move the balance to prepayments, then amortises it month by month for the next twelve months.
Every month. In a spreadsheet.
That lives outside Xero. That only one person knows how to update.
What Should Be Happening
Spread reads the invoice.
Detects it's a 12-month prepayment.
Reverses the existing journal
Posts the correct monthly journals to the P&L each month.
No spreadsheet. No calculation. No reminder.
Common Prepayments Spread Handles
✅ Annual Insurance Premiums
✅ Annual Maintenance Contracts
✅ Marketing Retainers
✅ Software Licences
✅ Quarterly Rent Invoices
✅ Annual Service Charges
Three Steps To Automated Prepayments
No spreadsheets. No manual journals. Just Xero, working the way it should.
Step 1: We Read Your Invoices
What normally happens:
You’re trawling through Xero invoices and attachments manually.
With Spread:
When a prepayment invoice arrives in Xero, Spread reads both the line item description and the PDF attachment. It detects the service start and end date.
✅ Multi-currency and multi-line invoices supported
✅ Tracking categories replicated from transaction
Step 2: We Post The Prepayment Journals
What normally happens:
You’re eyeballing a spreadsheet to decide what to release each month.
With Spread:
The full invoice amount is reversed, and Spread posts journals for the correct portion to the P&L each month. No manual calculation. No reminder needed.
✅ Multi-line, multi-currency invoices handled at line-item level
✅ Costs in the correct months for accurate reporting.
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Step 3: You Review and Approve
What normally happens:
You’re looking back at your spreadsheet to check everything's correct.
With Spread:
Every journal is visible in Spread before it posts. High-confidence items are marked Ready. Anything unusual is flagged To Review. You choose the level of automation that suits your team.
✅ Our balance sheet reconciliation export shows every prepayment by supplier for extra control
✅ Audit-trail ready, every journal traceable to the source invoice posting user.
The Journals Are Ready Before You've Even Started Month-End.
You Just Approve Them.
Most accountants are still doing this in Excel. That's a spreadsheet that's wrong half the time, lives outside Xero, and only one person knows how to use.
Who's it for?
Spread is built for finance professionals who need their numbers to be right, and need to be able to prove it.
1 / Finance Teams using Xero
You're managing 50, 100, 150 prepayment schedules in a spreadsheet. Every month someone has to update it. When they leave, their replacement has to decode it. Spread replaces the spreadsheet with a system, visible to everyone, maintained automatically.
Close with confidence, not crossed fingers.
2 / Accountancy Practices
Prepayment schedules are client-specific, version-prone, and time-consuming to maintain. Spread applies the same prepayment logic to every client, every month, without individual spreadsheets per client and without the knowledge walking out the door.
Your senior accountants stop doing the work. Your whole team closes faster. And you take on more clients without adding headcount.
Customer Reviews
The perfect add-on to make up for Xero's deficiencies. Spread has transformed the processing of deferred income and prepayments. Not only is it intuitive and easy to use, but on the rare occasions where support is needed the response in almost instant.
Rosemary Browne
The demo and trial were seamless, accurately identifying accrual and prepayment periods from our invoices. Support was fast and friendly, and the Recurring Bills feature adds real value. We're confident this partnership will succeed.
Anna de Courtenay Wellum
It's refreshing to find a product that does exactly what it says it will. Spread will make a huge difference to our month-end deferred income and prepayment accounting processes, and the reconciliation reports are an excellent addition.
Louise Simms
Prepayments Handled Before You've Started Month-End
Read our complete guide: How Do I Automate Accruals and Prepayments in Xero?
Connect your Xero in under two minutes. Your first journals are ready before month-end.
No Credit Card